Posted: Sat, Feb 9, 2002, 12:10 PM ET (1710 GMT)
The troubled Galileo project, a European effort to develop a global positioning system to rival GPS, suffered two key setbacks this week that threaten to derail the project, the Financial Times reported Friday. On Thursday the European Commission failed to convince a number of member states in a private meeting that the project would make commercial sense, while the European Parliament voted to keep private companies outside the project to prevent conflicts of interest among those lobbying for the project. Some nations, including the UK, the Netherlands, and Germany, are skeptical of claims that the program will generate up to 18 billion euros (US$15.7 billion) of benefits, and thus are less willing to support the project. The European Space Agency approved 500 million euros (US$435 million) for its share of the 2.7-billion euro (US$2.3 billion) project in November, but in December European transport ministers failed to approve 450 million euros (US$390 million) to fund its share of the project. The rest of the funding, at least prior to Thursday, was to come from public-private partnerships. The transport ministers will meet again in March for what may be one final effort to fund the project before the project is killed.

Related Links:

•  Financial Times article
•  Galileo web site